Category Archives: Economy

11 Things That Will Be More Expense This Year

1. Domestic and International Airfare

Greater demand and fewer available airline seats will likely lead to higher ticket prices for flights next year.American Express predicts prices within North America will increase up to 5% for economy seating, depending on the length of the flight, and up to 7% in business class. Things look more bleak for European travel. A new “green tax” implemented by the EU is aimed at reducing emissions, and it will levy a fee of roughly $15 per passenger, each way, for flights to the U.S. Fees on shorter flights within the EU will be taxed slightly less.

2. New Digital Camera Models
Smartphones have quickly replaced budget friendly point-and-shoot cameras, so manufacturers and retailers are focusing more on higher-end digital SLR’s. This year, consumers may have a hard time finding a newly-released digital camera with an inexpensive starting price, as the market is moving towards more feature-rich products. “Lower cost products just won’t come to market and those that will be out there, will be priced more and more for profitability,” says Stephen Baker, Vice President of Industry Analysis at the NPD Group.

3. Hard Drives
There’s been a shortage of hard drives thanks to epic flooding in Thailand in 2011, and some retailers have actually been rationing hard drive–based products. As a result, we’ve seen fewer hard drive discounts. Expect continued shortages throughout the first quarter of 2012, which is when experts predict that production will begin to catch up to demand.

4. Desktop Computers
The consolidation of desktop features into monitor-integrated units — many with touchscreens — will drive desktop prices up in 2012, according to Baker. Expect average selling prices to increase roughly 30% on new desktops.

5. Food for Home Preparation
If your grocery bill seemed higher in 2011, you weren’t imagining things. Most retailers have reported that food prices are rising and those increases are being passed along to shoppers. Food costs rose 6% last year and will likely go up at least 2% more in 2012. Increases are likely to affect food eaten at home, rather than restaurants where those costs are easier to absorb when combined with sales of liquor, says Harry Balzer, Chief Industry Analyst for the NPD Group.

6. Mobile Device Data Plans
Data plans in the past have had a tendency to decline, but as carriers build out 4G services, and move away from unlimited plans, data is set to become more expensive in 2012, according to Ross Rubin, Executive Director of Connected Intelligence at the NPD Group.

7. City-Enforced Fees
As municipalities look for ways to make up for budget shortfalls, fees for everything from dog licenses to vehicle registration and parking rates are going up, as is enforcement of fine-related infractions. In Chicago for example, a non-registered dog can elicit a $500 fine, while parking fines in Portland are going up 18% as the city tries to make up a $16 billion transportation budget deficit.

8. Water
Most communities in the United States will face water rate hikes this year, even places that are rich with the natural resource. Water rates in the greater Chicago area will increase by as much as 25% next year, while the parched high desert Denver market is set to rise an additional 5.5%. Like the above-mentioned fees, this increase is mostly a result of cities needing to increase revenue to balance their budgets.

9. Gas
Fuel prices began inching up just before the holidays, and 2012 is looking to be another budget-breaking year at the pump, with prices once again topping $4 per gallon.

10. Gold
The precious metal is poised to achieve its 11th straight year of growth. Gold prices bounced around a lot in the second half of 2011, but analysts expect it to rise roughly 12% in 2012. It’s a conservative estimate and a lot lower than the 17% annual growth rate of the past decade, but most believe gold will be more expensive. Take that to the bank.

11. Shipping
Unfortunately for avid online shoppers, the U.S. Postal Service will raise rates by an average of 4.6% next year, while both FedEx and UPS are hiking small package rates by 4.9%. Personal shipping will certainly cost more and it’s anybody’s guess how long retailers can continue the ubiquitous free shipping offers as rates rise.

Advertisements